Major banks trim some mortgage rates

ASB, one of NZ’s major Australian-owned banks, has lowered some short-term mortgage rates for the third time in two weeks.

However, some term deposit rates have also been lowered.

It has lowered its six-month rate by 10 basis points from 7.39% to 7.29%, one-year term 5 basis points to 7.24%, and its two-year mortgage rate six basis points to 6.79%.

“With more than three-quarters of our fixed home lending customers currently opting for terms of 24 months or less, our rate reductions on these popular terms will appeal to New Zealand homeowners and prospective homeowners,” said ASB executive general manager for personal banking Adam Boyd.

For savers, the bank has dropped its 12-month term deposit rate to 6.00%, and four other longer-term deposit rates by between five and 20 basis points, meaning they will earn less on the money they invest.

New Zealand’s Kiwibank has also reduced its fixed home loan interest rates.

They lowered their six-month special fixed rate from 7.39% to 7.35%, one-year special fixed rate from 7.35% to 7.25%, and their two-year special fixed rate from 6.89% to 6.79%.

The Kiwibank special fixed rate requires a minimum 20% equity.

Their three-year special fixed rate has been reduced from 6.75% to 6.65%, the four-year special fixed rate is down from 6.69% to 6.55%, and the five-year special fixed rate has been reduced from 6.59% to 6.55%.

All the major banks have lowered some interest rates slightly over the past fortnight or so in response to recent decreases in retail swap rates.

In late February the Reserve Bank held the OCR at 5.5%.